With the case count rising across the country, the Insurance Regulatory and Development Authority of India (IRDAI) has unveiled a standard individual Covid-19 product, under which room charges have been capped at Rs 5,000 per day, ICU charges at Rs 10,000 per day and quarantine charges at Rs 3,000 per day, with a maximum sum insured of Rs 5 lakh.
While it is a draft product for now, and there may be some minor tweaks, the regulator has asked general and health insurers to ensure that this product is compulsorily offered on or before June 15.
Sources in the industry said while the existing health insurance policies cover Covid-19 treatment, the fresh IRDAI guidelines and caps would be limited to Covid-specific products that will be issued over the next 10 days.
The IRDAI move comes at a time when the total case count is over 2 lakh, of which 1,06,737 are active cases.
Sources said IRDAI has included treatment of Covid-19 patients in makeshift hospitals, which is not covered by the existing health insurance policies.
“This is an important addition. However, IRDAI could have made some changes to include this in the existing health insurance policies,” said a senior official with a leading general insurance company.
He said that while the IRDAI has come out with the product to offer a cheaper option to customers, “it’s unlikely that the product will be cheap as the line of treatment is not fixed, no one knows how the claims will behave. There is a risk and yes, we will take the risk”.
On June 1, The Indian Express reported that IRDAI has advised the General Insurance Council to work on a reasonable and standardised cost structure for Covid-19 treatment. Following feedback on a set of proposals, the IRDAI has now unveiled the Covid-19 product.
The policy tenure will be for one year, and it can be given on a family floater basis for persons with minimum entry age of 18 years and maximum of 65 years. However, it will be subject to lifelong renewability. The minimum sum insured should be Rs 50,000 and the maximum will be Rs 5 lakh, IRDAI said.
The hospitalisation cost should cover room, boarding, nursing expenses up to 2 per cent of the sum insured, capped at Rs 5,000 per day. It should also include surgeon, anaesthetist, medical practitioner, consultants, specialist fees, whether paid directly to the treating doctor, surgeon or hospital.
Anaesthesia, blood, oxygen, operation theatre charges, surgical appliances, medicines and drugs, costs towards diagnostics, diagnostic imaging modalities, and other similar expenses are also included. Expenses on hospitalisation for a minimum period of 24 hours are admissible, it said.
According to IRDAI, the policy will cover intensive care unit (ICU) expenses up to 5 per cent of sum insured, capped at Rs 10,000 per day, and expenses incurred on road ambulance, up to Rs 2,000 per hospitalisation. It will also cover all day care treatment.
The IRDAI proposal says that the Covid-19 product should have the basic mandatory covers, which must be uniform across the market. “Only two add-ons as specified, are allowed to be offered along with the standard Covid-19 product,” it said.
IRDAI said expenses incurred on hospitalisation under AYUSH (as defined in IRDAI (Health Insurance) Regulations, 2016) medicine will be covered without any sub-limits.
“Pre-hospitalisation medical expenses incurred for a period of 30 days prior to the date of hospitalisation should be admissible. Pre- hospitalisation expenses should cover the costs of diagnostics towards Covid–19,” it said.
According to IRDAI’s guidelines, post-hospitalisation medical expenses incurred for a period of 60 days from the date of discharge, following an admissible claim, should be included.
For the add-on cover, if the person is quarantined due to diagnosis or suspected infection, then the company will pay 1 per cent of sum insured per day, up to Rs 3,000 per day. In the case of daily hospital cash, the company will pay 0.5 per cent of sum insured per day for every 24 hours of hospitalisation on positive diagnosis of Covid-19.
The premium payable towards these two add-ons are to be specified separately so as to enable policy-holders to choose and pay based on the need, the IRDAI said.
The insurer may determine the price keeping in view the covers proposed to be offered, subject to compliance with the norms specified in the IRDAI (Health Insurance) Regulations, 2016 and Guidelines.
The base covers of standard Covid-19 product should be offered on indemnity basis, whereas add-ons should be made available on benefit basis.
The standard Covid–19 product should comply with portability provisions and premium can be made on monthly, quarterly, half-yearly and yearly basis, IRDAI said. The premium under this product should be on pan-India basis and no geographic location or zone-based pricing is allowed, it said.
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